Potential Pirate Bay buyer could lose P2P partner

A much more detailed update be found here.

Johan Ljungberg, CEO of Peerialism, the technology company that is supposed to be an integral part of a revamped Pirate Bay, said Thursday he has developed doubts about the plan.

When it was announced in June that Global Gaming Factory X, would acquire The Pirate Bay for about $8 million, the Swedish software company said it would also pay about $13.5 million to obtain Peerialism.

Peerialism's technology improves the transferring and storage of data over peer-to-peer networks. Pandeya's stated intention is to use Peerialism's technology to help tap into the computing power that belongs to The Pirate Bay's 20 million monthly users and create a huge content distribution network. Provided users offered enough hard drive space, Pandeya would in exchange supply users with free movies and music.

But Ljungberg told CNET News on Thursday that at the very least Pandeya will not make some of his deadlines for opening a restructured Pirate Bay, the world's best known file-sharing site. That's because much of the preparation has yet to be started.

More than two months ago, Pandeya hired Peerialism to begin doing some of the production work. Pandeya agreed to pay half the money upfront and the other half when the job was completed.

"That was two months ago but he hasn't paid anything," Ljungberg said. "We have his signature on the contract, but he hasn't paid and we haven't done the work."

Ljungberg said that while Pandeya has been very communicative with the press, he is far more tight lipped with partners.

"From the beginning we asked to see a business plan, the names of his investors, or to see some (technical specifications)," Ljungberg said. "We still haven't heard a thing...the question marks are growing bigger by the day. We're not quite comfortable with the situation. We had really high hopes and ambitions for our technology but I'm not sure if this is the right home for it."

Pandeya, who is scheduled to present his plan to Global Gaming's investors and board next week, did not respond to interview requests.

Ljungberg isn't the first to express doubts about Global Gaming's ability to pull off the Pirate Bay acquisition or to turn it into a legitimate service. Last month, Pandeya hired Wayne Rosso, the former president of Grokster, to help him secure licenses from film studios and music labels.

Rosso walked away from the deal after only three weeks, citing issues about Pandeya's credibility. He also said that he didn't think Pandeya had enough funding to close the deal.

In additon, Rosso also said that Pandeya hasn't paid him for his services.

Pandeya has said all along that he does have the money and that the acquisition will likely be completed sometime soon after August 27, the day his board will vote on whether to approve the plan.